Trader Joe’s is loved by its shoppers for its good prices and constant flow of surprising new treats. A new type of dark chocolate bar? A new flavor of tea? A new dip? Of course I’ll try it!
A new investigation from food publication Taste indicates that some small food brands believe Trader Joe’s ripped them off, copied their product and excluded them from a potential deal.
Unlike a regular grocery store, Trader Joe’s primarily only carries its own private label – for example, it sells a large box of yellow cereal of “Joe-O’s” instead of Cheerios.
For some packaged items, the Trader Joe’s version is made by a well-known brand under a private label agreement. Trader Joe’s doesn’t make these deals public, but it can be easy to guess what a product is “duped.” Eater analyzed FDA recalls to find out which brand made a white-label Trader Joe’s version. From Eater’s 2017 analysis: Stacy’s pita chips also made Trader Joe’s pita chips, Naked made their green juice, Tribe made classic hummus, and so on.
According to the Taste report, in some cases Trader Joe’s expressed interest in a small brand, requested samples and more information under the guise of striking a deal with the brand, then turned around and made a product on its own very similar. .
A company called Brooklyn Delhi that makes jarred Indian sauces believes Trader Joe’s copied one of its iconic sauces after a private label deal fell through. Another small brand, Auria’s Malaysian Kitchen, claims a similar thing happened to them:
According to (Auria) Abraham, the parameters of the deal required it to partner with a specific co-packer (a third party that handles manufacturing) based in California. Abraham exchanged several calls and emails with the co-packer in late 2019, but the financial terms were onerous, leaving Abraham uneasy about a potential partnership. In exchange for privately labeling her product for Trader Joe’s, she was told she would receive a modest finder’s fee based on the co-packer’s profits, not a percentage of Trader Joe’s sales. After sharing samples with the co-packer and sending a counteroffer asking for greater transparency, she never heard back from him or Trader Joe’s. Within months, Trader Joe’s launched a product with a similar recipe and flavor profile to what it called Thai green chili sauce. Her sauce also featured jalapeño and Auria’s signature sambal ingredient, makrut lime leaves (Trader Joe’s labeled them as “Thai lime leaves” on the jar of its product).
Small brand owners said Trader Joe’s tactics are different from Costco or other large chains that practice private labeling. One brand owner, who believes Trader Joe’s copied its hummus with a chili crunch topping, compared the grocer to fast fashion brands Shein or Zara.
Trader Joe’s told Taste, in response to questions about its history: “When we develop our products, we meet with many potential producers to determine which one can best ensure food safety, production capacity, product quality and price. We pride ourselves on our “We have a long history of supporting suppliers and their growth. For various reasons, we are not able to work with every company we contact and realize that our decisions not to pursue certain products may be disappointing. ” Trader Joe’s did not immediately respond to a request for comment from Business Insider.
I love shopping at Trader Joe’s, not only because they have good prices on basics, but also because they have fun new items to try. Knowing that these new releases can sometimes be the result of deals that could crush a smaller brand, well, that doesn’t feel good.
businessinsider
